Collusion How Central Bankers Rigged The World

Collusion How Central Bankers Rigged The World: War On Gold

Collusion How Central Bankers Rigged The World

An empty head is not really empty; it is stuffed with rubbish. Hence the difficulty of forcing anything into an empty head. Eric Hoffer

They might lose a battle or two, but war is a composition of battles, and when it comes to war, these guys never lose, as their principle is simple. Take no prisoners, shoot to kill and ask questions only if the enemy survives the onslaught of bullets.  This would be a good time to read the book “the art of war” by Sun Tzu.

We have stated that the world is in a full-blown currency war:  Japan just upped the ante by cutting rates into negative territory, and Sweden has driven the knife deeper by pushing negative rates even lower. Sweden has stated they are prepared to do this until inflation is at 2%. Interest rates are -0.5% currently, so one wonders how low rates will have to drop for them to hit this pie-in-the-sky inflation target of 2%

Collusion: How Central Bankers Rigged The Game

This will pressure China and other nations to take the same route; the velocity of the “devalue or die” currency war game has increased five-fold.  It won’t be long before the Fed takes a similar path. Start paying attention to the news, for our central bankers will suddenly start listing several factors to backtrack on their claims that the economy was sound.   Many Gold bugs have been stating that the central bankers are running out of room to manoeuvre; our response is a dream on.   Look at the stunning rally the markets mounted when BOJ (Bank of Japan) fired its latest shot.

The only day the central bankers will run out of ammunition is the day the masses wake up, and that day is still a long way in the making.  Central bankers don’t need to lower rates continuously; they can flood the markets with money while maintaining an ultra-low rate environment.

What’s another 1-2 trillion dollars when our debt is over $19 trillion? What has changed between 2000 and 2016; our debt in 2000 was significantly lower and even lower in 1990; from the 1980s, the debt has tacked on roughly 17.6 trillion dollars, and the masses are still quiet.

The short answer is that nothing has changed other than the misery individuals are forced to endure. 76% of families are living from paycheck to paycheck. Does that signify an improving economy for you?  It seems that this phenomenon is not restricted to the poor only. According to CBS, 33% of families earning 75,000 per year live paycheck to paycheck.

Today the average hourly salary is approximately $25.00 an hour.  Do you know that $22.41 today has the same buying power as $4.03, the average wage in 1973?  So $25.00 has roughly the buying power of less than $5.00.  Welcome to the infamous and deadly game of inflation.

Things will only worsen; the dollar amount might look like it’s trending upward, but individuals are working more for a lot less; to solve a problem, you have to understand it. The masses are blind to the concept of inflation. They are caught up in a vicious game of just trying to pay the bills and survive. They hardly look up to see what is going on. This sort of like Plato’s allegory of the cave; if you are unfamiliar with this famous concept, you can view it here

The Fed Appears To Be Omnipotent

Against this backdrop, we can safely state that the Fed is omnipotent and that those gold bugs and hard money experts are smoking some strong medicine that they need to get off immediately when they falsely assume that Gold will surge to the moon simply because the Fed has the pedal to the metal.

We believe in hard money and think the world would be better if central bankers adhered to such rules. We are not fools; we understand that being right does not equate to market success.  The key to deciphering the stock market is understanding the masses.

The crowd believes that the Fed and the government can solve their problems. Until they think otherwise, the Gold bugs and the hard money experts will experience small moments of victory followed by massive periods of punishment. This is why they cannot understand why gold and the precious metals sector have taken a beating since 2011.  Gold will rise again, but given enough time, any crappy industry can have its day in the sun.

Main Point to keep in mind

This is why it is dangerous to be a Gold bug, for they assume that precious metals can rise forever in price. They will make the same mistake during the next Bull Run in metals. No market can trend upward forever, the only exception being stupidity; it has been in a perpetual bull market, and there are no signs of a minor correction.

Central bankers have not run out of firepower. They are so cocky now that they have barely started firing their bullets. So far, they have been using pistols and rifles; they are about to transition to machine guns.   The masses are sedated, so this process of pillaging the populace will continue for an extended period. Translation; robust market corrections or, as the naysayers would have you believe, “market crashes” have to be viewed as buying opportunities.

Game Plan For precious metals

We are not stating that Gold and Silver will not have their day in the sun again. We still believe that Gold could trade high as $5,000 and silver north at $200.  We have still not had the feeding frenzy stage; in other words, the masses did not participate in the last Bull Run that ended in 2011. However, do not assume that Gold or any market will trend upward forever.  At this point of the game, it makes sense to deploy some money into Bullion. Limiting your foray into Gold stocks would be wise until there is a clear signal that a bottom is in place.


Other articles of interest:

People’s QE: Central bankers forcing the public to speculate (Feb 18)

War On Wealth: Central Target the Masses (Feb 18)

Why Most Hated Bull Market in History still has staying power  (Feb 17)

American woes, worthless dollars forces USA to Engage Russia (Feb 17)

Wall Street Smart Money buying: Mass, Dumb Money selling (Feb 17)